eBusiness Weekly
Enacy Mapakame
The Energy Capital and Power(ECP) says the region, Zimbabwe included has an opportunity to leverage value addition of its vast mineral resources to meet the global demand, which is projected to balloon in the next few decades due to adverse impacts of climate change among other challenges.
The World Bank has forecast that the production of critical minerals will need to increase by approximately 500 percent by 2050 to meet the rise in global demand and allow the world to avoid the worst impacts of climate change.
Africa is home to 30 percent of the world’s mineral reserves and has the opportunity to harness its mineral wealth to power the global energy transition while developing sustainable value chains and promoting socio-economic growth, job creation, and environmental protection. However, for the continent’s mineral resources to translate to economic wealth, the critical mineral value chain needs to be enhanced, with regulatory policies and reforms, advancements in processing and refining capacity and heightened investment in exploration serving as key solutions.
As such, Africa’s resources are well-positioned to play a crucial role, thus allowing the continent to strengthen its position in green technology value chains.
“Almost every African country is rich with either one or more critical minerals. Guinea, for example, is home to the world’s largest bauxite reserves while Gabon is the second largest producer of manganese. The Democratic Republic of the Congo (DRC) hosts over 70 percent of the world’s cobalt production, with Namibia serving as the world’s leading exporter of uranium ore.
“Meanwhile, Mozambique and Zimbabwe are the world’s third largest producers of graphite and chromium ore, respectively, while Zambia serves as the largest exporter of unrefined copper and South Africa accounts for the majority of platinum group metal (PGM) reserves, of which over 90 percent are situated in Africa,” said ECP.
ECP further notes the region, however, needs a regulatory framework that enables it to maximise value creation such as governments developing comprehensive policies, manage environmental risks, and ensure a favourable investment environment for the private sector to participate in the development of efficient critical minerals extraction and processing.
The challenge, however, is that a limited amount of Africa’s critical minerals is processed on the continent. As such, multilateral development finance institution, the African Development Bank, has sought solutions towards overcoming value chain challenges through the development of a critical minerals strategy that includes securing a necessary skills base, ensuring reliable electricity supply, and improving the investment climate on the continent.
“Recently, Zimbabwe has also made strides to reduce unprocessed exports through a law banning the exports of unrefined lithium. The move represents part of wider efforts by the government to stimulate growth across the domestic mineral value chain.
“Additionally, Regional value chain development, such as Zambia and the DRC’s 2022 agreement for the joint development of electric battery manufacturing capacity, for example, could serve to strengthen Africa’s position within the critical mineral value chain,” said ECP.
In order for the continent’s natural resource wealth to translate into industrialisation and development, countries endowed with vast deposits of critical minerals will need to develop a sound governance environment that targets processing minerals in-country for consumption in domestic and/or regional markets.
As such, transparency of contracts, strong labour rights and environmental sustainability will be key towards maximising the opportunity afforded by enhancing the continent’s critical minerals value chain, which is poised to translate into value addition, job creation, local content development, and an equitable knowledge transfer.
